Eye on Oracle

Nov 18 2010   5:02PM GMT

Oracle’s current legal troubles extend beyond Oracle vs. SAP trial

Shayna Garlick Shayna Garlick Profile: Shayna Garlick

Oracle is currently going head to head with SAP in the courtroom over its competitor’s alleged intellectual property theft.  And while the high-profile case may be nearing a long-awaited conclusion, it seems like the end of this trial is not going to mean the end of all legal issues for the software giant.

The Service Industry Association, a group made up of about 130 hardware maintenance providers, is calling Oracle’s hardware maintenance policies anticompetitive and has filed an appeal with the U.S. Department of Justice (DOJ).  The DOJ gave Oracle the green light for the Oracle Sun acquisition last year, and the European Commission approved the deal in January after assuring that fair competition would be preserved in the market.

But the SIA has a different view.  It claims that Oracle is abusing its dominant market position with its new hardware maintenance policies, especially in regards to the $2.4 million of Sun maintenance business contracted to Independent Service Organizations (ISOs).  ISOs are now prevented from servicing the hardware break-fix needs of its Sun hardware customers, it claims.

Alleged anticompetitive practices of Oracle by the SIA include:

  • Oracle restricts access to its operating systems only to those users with existing hardware maintenance contracts.
  • Oracle has enacted “Return to Oracle” service restoration fees for those who use an ISO but then later return to Oracle support.
  • Those using ISOs cannot split their service requirements between the ISO and Oracle, and Oracle will not support any of an ISO customer’s Sun hardware.

In other news, Oracle has filed a lawsuit of its own against a hardware partner, Multis. Multis had a contract with Sun Microsystems when Oracle purchased Sun, and its contract involved services related to remanufacturing Sun technology, such as product refurbishing and distribution.

Multis has had three burglaries at one of its warehouses since July 2009, and now Oracle is seeking damages of at least $328,742. The software giant is claiming its partner did not have insurance to cover the losses from the thefts, and according to their contract, Multis is liable for the product losses and damages from the burglaries.

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